Shares of Zee Entertainment Enterprises (ZEEL) surged 6% to Rs 194.80 in intraday trade on the National Stock Exchange (NSE) on Tuesday after the exchange announced on Monday that the stock would be reintroduced into the futures and options (F&O) segment.

The NSE’s move follows the National Company Law Appellate Tribunal’s (NCLAT) decision to continue the National Company Law Tribunal’s (NCLT) recognition of insolvency proceedings against ZEEL.

At 9:24 am, ZEEL was quoted 4.4% higher at Rs 191.05, while Nifty 50 was up 0.06%. A total of 3.8 million shares changed hands over the counters of the NSE and BSE.

Shares of television broadcasting and software production fell 15% in the past six trading days between February 17 and February 27 after NCLT acknowledged IndusInd Bank’s bankruptcy filing against ZEEL.

However, NCLAT, Chief Judge of New Delhi (see order dated February 24, 2023) granted a stay of NCLT, Mumbai Bench, Third Court Order dated February 22 2023, w.r.t IBC against ZEEL.

The NSE said that after issuing the NCLAT order, ZEEL would be withdrawn from the IBC framework, and therefore, the stock surveillance operations would resume. The NSE has since informed Zee Entertainment that it will offer futures and options contracts for May 2024.

“NCLAT, principal bench, New Delhi’s vide order of February 24 has granted the stay of NCLT Mumbai bench order on February 22 w.r.t. IBC’s proceedings against ZEEL,” the exchange said in a circular.

Share prices were corrected after NCLT admitted bankruptcy proceedings as ongoing arbitration issues could delay the timetable for a merger with Sony Pictures Networks India Private Limited (SPNI). Prabhudas Lilladher announced the post-NCLT order on February 23. Unless ZEEL amicably resolves the dispute or achieves a stay of the order, the timeline for the merger may be further delayed.

The brokerage maintained its ‘buy’ call on the stock with a target price of Rs 277.